The first time I read an article in the mainstream press in which two hospital CEOs were waging a very public battle over market turf, I was surprised. I wondered, in fact, why the hospitals' communications team didn't march into these CEOs offices, unplug their phones, and duct tape them to their chairs to prevent them from airing their grievances in the press.
Then I started to see a lot more of these stories, and started hearing about hospitals that were getting downright aggressive in their marketing efforts—putting up billboards across the street from their competitors' hospitals and opening up clinics further and further away from their core markets—right in their competitors' back yards.
Then there are the bidding wars over the top physicians and rock star specialists. And lawsuits over who has the most top docs and more.
One reason for this new combative attitude is the economy, of course. But another is that patients are no longer just wandering like so many sheep into the closest hospital for tests and procedures—they're more willing to travel to get what they perceive as the best care.
Hospitals are moving beyond their primary—or even secondary market—into every geographic area that they can, says Robert Sutton, founding partner at IMA Consulting in Chadds Ford, PA. "People are much more well-informed because of the Internet that they're willing to travel further to get the best service."
No matter how unseemly, the big question, it seems to me, is whether or not these tactics work. They might turn friendly competitors into sworn enemies and public battles might be a big turnoff to the public in general. But if the end result is an increase in volume, does that really matter?
"Hospital competition is really driven off of the need to maintain a certain level of volume," Sutton says. "Hospitals don't make money when they're 50% occupied."
So what's more important, a hospital's reputation and image? Or grabbing as much market share by any means necessary?
You can read more about what healthcare leaders and others think in The Fight Over Market Share Gets Nasty, published in this month's HealthLeaders magazine.
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Once trumpeted as the best hope to control spiraling healthcare costs, consumer-driven health plans have been largely pushed aside during healthcare reform talks in Washington. In fact, you're as likely to hear lawmakers use the phrase "capitation" as CDHPs.
In an attempt to resurrect CDHPs' standing and make them part of the healthcare reform debate, two reports released over the past week from the health insurance industry promote the idea of health savings accounts. But health insurers need more than just surveys given the heightened interest of a public health plan in Washington. The industry must improve on CDHP tools, such as cost and quality Web sites, real-time claims adjudication, and member outreach, in preparation of competition from a public health plan.
CDHPs may not be part of the current healthcare reform lexicon, but the interest is obviously there. Enrollment numbers have skyrocketed in the last four years. America's Health Insurance Plans announced that 8 million Americans are now covered by HSA-eligible plans, about 2 million more than at the start of 2008. Previous AHIP census reports show steady enrollment growth in HSAs from 1 million in March 2005 to 6.1 million members in January 2008.
HSAs are the more popular sibling in the HSA/Health reimbursement arrangement (HRA) family. HSAs allow both the employee and employer to fund the account and workers can take it with them when they change jobs. This combination, supporters say, leads individuals to view HSAs as their own money. The end result is people become better healthcare consumers.
Critics, on the other hand, charge that HSAs benefit only wealthy people, who use them as savings accounts. A Government Accountability Office report last year found average adjusted gross income of taxpayers with HSAs was $139,000 in 2005, compared with an average of $57,000 for all other filers.
AHIP, however, dismissed that argument, claiming that HSA holders have a broad range of incomes. AHIP's study, Estimated Income Characteristics of HSA Accountholders in 2008, claims that 49% of accountholders live in neighborhoods with median incomes under $50,000, and that the average total deposits for all HSA accounts were $1,634, while the average total withdrawals were $1,063.
Another study released last week showed that the vast majority of HSA owners are satisfied with their accounts. OptumHealth Inc., a wellness company that serves 60 million people, handles nearly 400,000 HSAs, and is owned by UnitedHealth Group, reported that 91% of 500 HSA owners randomly surveyed nationally this year are happy with their accounts. Piggybacking on AHIP's claims that HSAs are not just for the wealthy, OptumHealth reported that 70% of those surveyed make $75,000 annually or less. OptumHealth also reported that HSAs are actually achieving their goal—making better healthcare consumers:
64% of respondents said they inquired about generic options for medication.
47% said they asked their providers about charges.
83% said that people should research healthcare options to get the best price.
72% of respondents said that individuals should be responsible for helping manage their own healthcare costs.
These two studies were released at the same time that the healthcare reform debate rages in DC. That's not a coincidence. Private health plans are rightfully viewing portions of healthcare reform as a direct assault on their business.
HSAs, the poster boys for creating better healthcare consumers and lowering healthcare costs under the Bush administration, are not seen by most Democrats as a solution—but rather a problem that prices the poor out of quality healthcare.
Democratic lawmakers, instead, are discussing a public insurance option, which they say would create a level playing field to compete against private insurers, and ultimately reduce healthcare costs.
Despite lawmakers being enamored by a public plan, health plan officials are still viewing HSAs and CDHPs as a cost-saving, patient-empowering movement, as was evident in the health plan portion of the HealthLeaders Media Industry Survey 2009.
Beyond the HealthLeaders Media results, employers are increasingly turning to HSAs as a way to control costs. Sure, HSAs are not likely to be part of healthcare reform, but as long as Congress keeps those accounts as an option for businesses and private plans, employers will remain interested in reducing costs through better consumerism and cost sharing.
Health insurers have made a number of concessions in hopes of derailing a public health plan, but HSAs could be a way for private plans to compete against a public plan because the savings accounts will help keep costs down and provide a distinct difference to a public plan with low administration costs.
Health insurers should review their HSAs, improve their consumerism tools, and prepare for potential battle against a public plan.
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Ask William Schaffner, MD, why 50% of all adults don't get recommended vaccinations and he'll give you five reasons.
"Funding, funding, funding, funding, and if you haven't gotten it yet, funding," says the president-elect of the National Foundation for Infectious Diseases.
If governments want to get adults vaccinated to prevent billions of dollars in healthcare costs, not to mention avoid unnecessary death and disability, they need to incentivize physicians and hospitals—the entire healthcare delivery spectrum—to promote immunization, he says. That's just not being done today.
For any health reform package, it has to be an important consideration. That's why Schaffner's foundation has launching a "Call To Action" campaign and informational Web site promoting vaccines in an effort to bring adult immunization to the top of the priority list in the national health reform debate.
The Web site has detailed information from the Centers for Disease Control and Prevention on 11 approved vaccines, as well as estimates of how much not vaccinating people costs the healthcare system.
Schaffner says 90% of children get recommended vaccines because there is an adequate reimbursement and infrastructure in place (through providers and schools) that makes sure of it. Not so for adults. "The nation has not made the same sustained commitment to vaccination for adults as for children," says the foundation's Web site.
Take, for example, herpes zoster, or shingles, a painful reactivation of the chickenpox virus that affects half of people over age 60. And for one in five of those, a more severe, sometimes life-altering condition called post herpetic neuralgia sets in that can lead to congestive heart failure, heart attack, type II diabetes, and major depression.
The U.S. Food and Drug Administration approved an effective vaccine three years ago, yet only 3% or 4% of seniors over age 60 have received it, says the Vanderbilt University chairman of Preventive Medicine.
Although Medicare will pay for it, the vaccine was put under Part D, which means the patient must be told about the vaccine by a physician, purchase the vaccine from a pharmacist, and "brownbag" it back to his or her doctor to have it administered.
A bill was introduced in the last session of Congress to have reimbursement for herpes zoster vaccine moved to Part B, so the physician can be reimbursed for administering it. But, Schaffner says, "it didn't go anywhere."
One way around the barrier is to have pharmacists trained to administer the vaccine, which is the way it's done at Vanderbilt, Schaffner says. "But as you can see, that's a complete disincentive to have physicians interested in this program. My quip is that having a new shingles vaccine is like having a brand new Cadillac that you keep in the garage."
There needs to be a payment structure to allow busy pharmacists, who are in short supply throughout the country, to take time to do it as well.
Medicaid, the government's health plan for the poor, also is extremely inadequate in how it reimburses providers for vaccinations, in part because policies vary depending on the state, Schaffner says.
And there are 40 million people without health insurance for whom vaccination rates are spotty at best.
Third, even those who have health insurance may be in plans that don't cover vaccinations or have deductibles or co-pays that require that patient to pay out-of-pocket.
Additionally, the number and schedule of vaccines to be administered is confusing. So the Web site offers health providers a handy tool to help guide clinical practice.
Beverly Sha, MD, of Rush University Medical Center in Chicago, says reimbursement for vaccination is so poor and spotty, "It's a difficult thing for physicians. We never really know what we're being reimbursed because we're too busy worrying about our patients."
But when she decided to look into the cost of one vaccination for influenza, she found that the cost to buy the dose was $14, and the cost of administering it was $10 to $15. But the reimbursement from the insurance company was $10 for the vaccine and $6 for administration. And that didn't include the time to log in the patient's chart, to properly stock and refrigerate the vaccine, or the cost of the needle, syringe, and alcohol.
"We're actually losing money doing this," he says.
Reimbursement should be standardized across the country, she says, adding that it wouldn't be that hard because the costs are fairly standard no matter where a vaccine is given.
For example, influenza costs more than $10 billion a year yet rates of vaccination against influenza range between 37% and 42% for adults between 18 and 64, and only 69% for people age 65 and older.
In an article published in the May 20 issue of the Journal of the American Medical Association, CDC epidemiologist Andrew Kroger, MD, says 50,000 deaths a year—36,000 of them due to influenza—can be attributed to illnesses for which effective vaccines are recommended. Another 260,000 hospitalizations a year add up the bill.
Pneumococcal vaccinations are received by only 33% of the population between age 18 and 64 and 66% age 65 and over. A mere 10% of women between age 18 and 26 receive human papillomavirus vaccine.
A new Gallup Poll finds that many Americans–particularly the uninsured–are willing to travel abroad for major medical procedures, especially if they believe the quality of care would be the same, but significantly cheaper, than care in the United States.
Health insurance is an important factor in the likelihood that Americans would consider getting health treatment abroad. For example, 37% of uninsured respondents would seek cancer care abroad as compared to 22% with health insurance.
Gallup says the survey results indicate that the increasing cost of medical care in the United States and large numbers of uninsured is making medical tourism a viable option.
"If strides in insurance reimbursements, overseas hospital quality, and affordability continue, it will be an increasingly attractive option for Americans," Gallup says. "The data suggest the estimated population of 48 million Americans without health insurance are motivated by costs and would be more likely than those with health insurance coverage to consider seeking medical care from alternative sources."
The poll showed that:
29% of respondents would consider traveling outside of the US for alternative medical treatments for a major medical problem
24% would seek cancer diagnosis and treatment abroad
15% would receive orthopedic procedures
14% would consider traveling to another country for heart treatment
10% would seek plastic surgery
The mid-April poll of 5,050 adults involved a split-sample experiment. One random half-sample was asked the "direct" question on whether they would consider treatment abroad. The second half was asked whether they would consider treatment abroad assuming "the quality was the same and the costs significantly cheaper." Given that assurance, the percentage saying they would consider medical treatment outside U.S. borders increased by 12% on average. The poll has a 2% margin of error.
For example, when told that the cancer treatment they would get abroad was of equal quality and significantly cheaper than what they would get in the US, the percentage of respondents who said they’d consider traveling abroad from 24% to 37%.
Across regions, Midwesterners are the least willing to consider treatment abroad. Westerners are the most willing. Southerners are also below average in their enthusiasm for medical tourism, with the exception of hip or knee replacement.
If implemented correctly in the United States, comparative effectiveness research could show the capability to improve healthcare and reduce health costs, according to a new report from the Deloitte Center for Health Solutions. However, several barriers—including Americans' distrust of data sources—will need to be addressed in the meantime.
As a point of comparison, the report also looked at three clinical examples of comparative effectiveness studies in four national health programs (China, Germany, Great Britain, and Australia). Those clinical examples were: diagnostic screening detection (colon cancer), medications (the use of statins for treatment of elevated cholesterol), and surgical procedures (treatments for benign prostatic hyperplasia).
The report found that while countries' approaches to comparative effectiveness were instructive, "a cut-and-paste approach" to what works in those countries will not necessarily apply to the U.S., said Paul Keckley, PhD, the centers executive director, in a statement.
For instance, in comparing screening programs for colon cancer, Deloitte noted that while the types of testing used were similar among the countries, broad variations existed in the existence and characteristics of national or regional screening programs.
The report noted that consumers, as primary recipients of healthcare system products, have a large stake in the effectiveness and efficiencies of healthcare services. However, data from Deloitte's 2009 Survey of Health Care Consumers, showed that only 27% said they understood how the health system worked.
In terms of trust, the picture as related to consumers was bleaker. Only 31% of those surveyed said they viewed the federal government—which is a major sponsor of comparative effectiveness research—as a trusted source. Coming before the "government" category in terms of trust sources were associations and societies (51%) and academic medical centers/teaching hospitals (51%). Community hospitals were at 31%.
Comparative effectiveness can be seen as an "engine" for new innovation in the design and delivery of evidence-based care, Keckley said. Healthcare information technology, including electronic health records, "also may play a critical supporting role in its evolution," according to Deloitte.
The Vermont legislature has passed a law requiring drug and device makers to publicly disclose all money given to physicians and other healthcare providers, naming names and listing dollar amounts. The law is believed to be the most stringent state effort to regulate the marketing of medical products to doctors. It would also ban nearly all industry gifts, including meals, to doctors, nurses, medical staff, pharmacists, health plan administrators, and healthcare facilities.
New York Attorney General Andrew M. Cuomo recently announced an indictment that alleges Deborah Kantor, owner of H.I.S. Holdings, Inc., bribed a Niagara County Department of Social Services employee in order to gain assistance for approving Medicaid coverage for certain patients.
Kantor and H.I.S., a debt collection agency that serves many major hospitals in Western New York, including Niagara Falls Memorial Medical Center, were charged with bribery in the second degree and rewarding official misconduct in the second degree.
According to the release, Kantor paid Michael Albrecht, a DSS employee with access to the Welfare Management System (WSM) computer, to obtain Medicaid identification numbers for patients, which are required when billing Medicaid.
The release alleges Kantor provided names to Albrecht, which he would then research using the WSM computer. From there, Albrecht was able to obtain Medicaid client identification numbers for active accounts. Kantor would use those numbers to bill Medicaid. In some cases Albrecht was able to re-activate inactive Medicaid accounts without receiving the appropriate paperwork from Kantor and H.I.S., according to the release.
Kantor allegedly paid Albrecht $50 for every number he was able to provide. The Department of Justice claims that added up to approximately $17,700 between 2000 and 2007. On top of that, Kantor allegedly gave Albrecht a cell phone with service, and other gratuities for approving subpar Medicaid applications.
According to the release, the state wants H.I.S. and Kantor to repay the $730,000 the state paid H.I.S. as a result of the scheme and is seeking an additional $2.2 million in damages, per the state’s False Claims Act and Social Services Law.
The indictment also names Amy Gardner, an employee at H.I.S., and alleges she aided Kantor in the submission of a false Medicaid application. Kantor and Gardner knowingly submitted the application with the wrong address in order to obtain Medicaid reimbursement, the indictment alleges.
Kantor, H.I.S., and Gardner, have been charged with offering a false instrument for filing in the first degree and attempted grand larceny in the third degree.
Albrecht has not been charged in the case.
Ben Amirault is an Editorial Assistant for the revenue cycle division of HCPro. He manages theCompliance Monitor e-newsletter and has developed a number of online learning modules. He can be reached atbamirault@hcpro.com.
Thousands more Iowa children will be eligible for public health insurance under a bill signed into law by Gov. Chet Culver. The bill broadens eligibility for Hawk-I, the joint federal and state insurance program for children from moderate-income families. Starting July 1, families could make 300% of the federal poverty level—or about $64,000 per year for a family of four—and remain eligible for the program. The limit now is 250% of poverty.
Deborah Heart & Lung Center has filed a lawsuit that alleges Virtua Memorial Hospital Burlington County (NJ) and a group of cardiologists who practice there disparaged Deborah in an effort to keep heart patients from transferring there. The complaint accuses Virtua and the four doctors of unfair competition, slander, and "scare tactics." In several instances, it said doctors told patients in Virtua's emergency department that they could not transfer to Deborah because it was full when, in fact, it was not.
More people are canceling doctors' appointments, leaving prescriptions unfilled and skipping screenings such as Pap smears to save money, according to a national survey of family doctors. As a result, more patients are winding up with health problems that could have been prevented, the American Academy of Family Physicians said in its report. The academy e-mailed more than 8,000 doctors, asking questions about the effects of the recession, and 505 doctors completed the survey in March and April.
